"I Go To a Very Good Dentist"

At Thanksgiving dinner my friend's daughter in law told me that 'she goes to a very good dentist in Manhattan and that it only cost her $10.'

You can probably guess my immediate and shall we say 'indelicate' response to this very bright young lady who lacks the ability to judge excellence. I told this young lady that she did not go to a very good dentist who participated with her insurance and where she had to pay $10.

Let's think of this in terms of houses or cars which are things that we buy and can relatively understand. 

If someone pays $11,000 for a new car do you think that they have a right to expect that they have purchased a Lexus? Or if someone buys a fixer upper for $25,000 does anyone think that have purchased a magnificent home in Beverly Hills?

About every 18-24 months I review the finances of operating a private dental practice and I guess this is as good a time to repeat this:

The average dental office has an overhead of 70% which means that some overhead (rent, staff, supplies, lab fees, insurance, office taxes, donations  and utilities) are slightly below or above 70%. The government: federal, state, local, medicare, social security and school taxes amount to 50% of the remaining 30%. If you have done your math up to this point, it means that I get to take home and spend 15 cents out of every dollar that I produce. Is this a lot???? I don't think so.

Many dentists who participate with insurance companies give the insurance company a 20-30% discount from their usual fees.

Uh Oh….How does a dentist 'give away' 30% when overhead is 70% and they would make no income.

Easy:

…cleaning appointments will be 15-30 minutes instead of 45-60 minutes

…instead of using resin that is fabulous and costs $100 to fix front teeth, dentists will use a $50 resin

…instead of using a quality American laboratory to make crowns, they will use a Chinese lab that charges very little but may 'accidentally' use a little lead in the crown

…spend 10-15 minutes fixing a tooth instead of an hour

…constantly hire and fire staff so that no one knows your name when you enter the office.

Does this make sense? 

It is very challenging to participate with insurance companies and try to pursue excellence.

In the final analysis, if you pay a little for something, then your wisdom and intelligence  must tell you that you are not buying the best but rather the best at the (low) price that you are paying.

I hate talking about this .